The Blue Shield Blue Cross Association Antitrust Case
Introduction
The case of the Blue Shield Blue Cross Association trial evolved the issue related to the violation of the antitrust laws. The central claim associated with the organizational attempts to control the competition and establish the particular settlement in varied regions of the US. The company and its units were accused of disturbing the natural competitiveness in the open market. The general problem is related to the inclusion of settlement cases, which allow gaining maximum profitability based on the competitive agreement of the sides. It distributes the regions against the various organization, eliminating the notion of competitiveness. The current paper will be focused on analyzing the issue that Blue Shield Blue Cross Association antitrust case involved running an anticompetitive scheme.
Practically in all such situations, the antitrust case involves the appliance of the anti-competitiveness schemes. One of the primary types of such schemes is the division of the territories (Robertson, 2021). Anticompetitive agreements are illegal and, in some cases, even criminal acts. Such actions are aimed at limiting competition in specific market segments. When companies abandon healthy competition, monopoly relationships with customers develop harming both sides. Such unscrupulous and illegal agreements aim to extract surplus (Robertson, 2021). It may be dangerous not only for end consumers but also for the economy as a whole. The Sherman antitrust law regulates such inquiries. The Blue Shield Blue Cross Association’s plans related to the exclusive territories that particular divisions of the association own are a direct violation of Sherman law (Meyer, 2018). Considering that the association is one of the most powerful providers of Medicare services, such actions limit other organizations’ opportunities. The plaintiffs represented by the hospitals and physicians in the country claim the settlement problems. The current case is obviously evolving the implementation of the anti-competitiveness settlement scheme.
Anticompetitive agreements can be potentially dangerous for consumers and providers. Such cases when their counterparty is a dominant economic entity in the commodity market differ from the cases when they interact with a participant in an anticompetitive agreement. Such actions mean that they may not even be aware of the monopolization of the commodity market (Robertson, 2021). Therefore, anticompetitive agreements are often quite a serious threat to competition. The settlement and allocation benefits are a direct violation of the antitrust laws. An anticompetitive scheme allows the company to minimize insurance coverage for particular regions. The plaintiffs’ testimonies showed that the healthcare providers billing the Medicaid services experienced significant material damage in relation to the actions of the association (Bull, 2021). The anticompetitive scheme was openly included in the plans of the company related to the distribution of the competitive pressure. The situation resulted in organizing the second clue bid, which included “a bid for coverage from a second Blues Plan involved in the settlement” (Bull, 2021, para. 8). In other words, the situation the anticompetitive schemes were the basic measure applied by the association.
Conclusion
The results of the analysis supported the initial claim. The Blue Shield Blue Cross Association’s settlement plans focused on gaining the maximum profit by minimizing the competitiveness in the open market of medical insurance. Anticompetitive schemes were applied in the current case. To be more precise, the division of territory scheme was implemented. The Blue Shield Blue Cross Association, as one of the most potent insurance providers in the US, has significantly damaged its status by violating the Sherman law.
References
Bull, T. (2021). Blue Cross Blue Shield Antitrust Litigation – Proposed Settlement. PSA.
Meyer, H. (2018). Blues plans suffer setback in major antitrust case. Modern Healthcare.
Robertson, V. (2021). Loyalty rebates under EU competition and US antitrust Law. Contemporary Policy International.